 "Freecharge aims to be OS of digital payments in India")
Eight weeks after morphing into a digital wallet, Freecharge, an online recharge platform owned by online marketplace Snapdeal, is aiming at being an “operating system” for a digital payments system through partnerships with vendors and banks across India.
“The biggest issue is acceptance (of digital payments by traders). The experience of acceptance is the thing we need to crack,” says Govind Rajan, chief operating officer, Freecharge. “India is a hyper-competitive market. You just can’t go to a merchant and say ‘use digital payments’ to save costs. He wants his revenue to grow.”
Rajan had helped Airtel Money get a payments bank licence, when he was its chief executive officer. He says Freecharge would partner with banks and expand the market by focusing on getting more vendors to use its mobile wallet to receive or make payments for goods and services.
Freecharge, which claims to have eight million active users, signed up as a sponsor for the Indian Premier League cricket tournament last week, committed to spending Rs 100 crore. It hopes the combination of high-pitch campaign during the short format cricket tourney and Rs 2,000 crore as coupons from its customers on the platform would drive more users for its wallet. “Just like an android platform or Apple iOS, we want Freecharge to be operating system for payments,” says Rajan. “Our philosophy is to grow with partners. If the system grows, we will grow.”
Snapdeal had acquired Freecharge in April for $400 million, one of the largest deals in the consumer internet space in India. The deal, a combination of stock and cash, helped Snapdeal get a platform for digital wallets and compete effectively with players such as Paytm, which is expanding into e-commerce. The Freecharge acquisition is also critical at a time when India is witnessing a surge in consumers using digital wallets to pay for goods and services such as taxi. A combination of policy decisions, led by the Reserve Bank of India allowing payments banks, increased use of smartphones that allow customers to transact online on the go and technologies that enable faster and secure transactions online is helping the ecosystem grow.
Rajan, who is also the chief strategy officer of Snapdeal, says Freecharge would launch a solution that connects offline businesses to online with a core philosophy that it is swifter and more secure than cash transactions. Vendors being part of the Freecharge platform would get paperless verification and not invest in additional equipment, with the entire transaction being enabled on its digital wallet on smartphones.
“Why should vendors require a device of $160 to accept payments? Payments should happen electronically. There is no need for device other than mobiles to accept payment,” says Rajan. “Our boundary condition, there is no investment for the retailer.”
“The biggest issue is acceptance (of digital payments by traders). The experience of acceptance is the thing we need to crack,” says Govind Rajan, chief operating officer, Freecharge. “India is a hyper-competitive market. You just can’t go to a merchant and say ‘use digital payments’ to save costs. He wants his revenue to grow.”
Rajan had helped Airtel Money get a payments bank licence, when he was its chief executive officer. He says Freecharge would partner with banks and expand the market by focusing on getting more vendors to use its mobile wallet to receive or make payments for goods and services.
Freecharge, which claims to have eight million active users, signed up as a sponsor for the Indian Premier League cricket tournament last week, committed to spending Rs 100 crore. It hopes the combination of high-pitch campaign during the short format cricket tourney and Rs 2,000 crore as coupons from its customers on the platform would drive more users for its wallet. “Just like an android platform or Apple iOS, we want Freecharge to be operating system for payments,” says Rajan. “Our philosophy is to grow with partners. If the system grows, we will grow.”
Snapdeal had acquired Freecharge in April for $400 million, one of the largest deals in the consumer internet space in India. The deal, a combination of stock and cash, helped Snapdeal get a platform for digital wallets and compete effectively with players such as Paytm, which is expanding into e-commerce. The Freecharge acquisition is also critical at a time when India is witnessing a surge in consumers using digital wallets to pay for goods and services such as taxi. A combination of policy decisions, led by the Reserve Bank of India allowing payments banks, increased use of smartphones that allow customers to transact online on the go and technologies that enable faster and secure transactions online is helping the ecosystem grow.
Rajan, who is also the chief strategy officer of Snapdeal, says Freecharge would launch a solution that connects offline businesses to online with a core philosophy that it is swifter and more secure than cash transactions. Vendors being part of the Freecharge platform would get paperless verification and not invest in additional equipment, with the entire transaction being enabled on its digital wallet on smartphones.
“Why should vendors require a device of $160 to accept payments? Payments should happen electronically. There is no need for device other than mobiles to accept payment,” says Rajan. “Our boundary condition, there is no investment for the retailer.”